Author: edwardsfl

What is Cohabitation?

Cohabitation refers to a situation where two people live together as a couple without being legally married or in a civil partnership. Often referred to as “living together” or erroneously as a “common-law marriage” (though the latter is not a legal term in the England and Wales), cohabiting couples typically share a home, finances, and a domestic life, but do not have the legal status of a married couple or civil partners.

Does Cohabitation Affect Divorce?

In England and Wales, cohabitation does not directly impact divorce, since divorce laws only apply to legally married couples or those in civil partnerships. However, for cohabiting couples who separate, there is no equivalent legal process for “divorce.” Instead, their separation is treated differently under family law, which can affect financial settlements, property rights, and other matters.

Key Differences Between Cohabitation and Divorce:

1. Legal Rights:
   • Married Couples: When a married couple divorces, they are entitled to claim a fair division of assets and financial support, including spousal maintenance if necessary. The court has a broad discretion to divide assets based on factors such as each party’s contributions, the length of the marriage, and the needs of each party.
   • Cohabiting Couples: If a cohabiting couple splits up, there is no automatic legal right to share assets or receive spousal support. Property and assets are typically divided based on ownership, meaning that the person whose name is on the title or deed of a property generally retains ownership, unless the other party can prove a beneficial interest.

2. Property Rights:
   • Married Couples: Upon divorce, married couples have the right to claim an equitable share of assets, including family homes, regardless of whose name is on the deed.
   • Cohabiting Couples: Cohabiting couples do not have automatic property rights. If the couple separates, the property is divided based on legal ownership, and the courts do not generally intervene to divide property unless there is a formal agreement, like a cohabitation agreement, or a claim to a beneficial interest (e.g., if both partners contributed to the mortgage or maintenance).

3. Children’s Rights:
   • For both married and cohabiting couples, child arrangements and maintenance rights remain the same. Parents—whether married or cohabiting—have a duty to support their children financially, and both parties have the right to seek a child arrangements order through the courts if there is a dispute.

Cohabitation Agreements:

To avoid disputes upon separation, cohabiting couples can draft a cohabitation agreement, which outlines the division of assets, finances, and responsibilities should the relationship end. While this agreement is not legally binding, it can be used as evidence in court to determine asset division and financial responsibilities.

The Growing “Cohabitation Crisis”:

In the UK, the number of cohabiting couples has increased significantly in recent years. Despite this, there is a lack of legal recognition and protection for cohabitants when relationships end. Many people mistakenly assume that they have the same legal rights as married couples, which often leads to disputes when relationships break down. This has led to calls for reform to offer better legal protections for cohabiting couples, especially when it comes to financial support and property division.

Conclusion:

While cohabitation does not directly impact divorce in England and Wales, it creates a different set of legal considerations for couples who separate. Married couples have a clear legal process for divorce and financial settlements, whereas cohabiting couples may face difficulties when dividing assets or seeking financial support. It’s important for those living together without marriage to understand their legal rights and consider a cohabitation agreement to safeguard their interests in case of a split.

The short answer is no, but this does not mean that a pre-nuptial agreement is not worth entering into. Quite the opposite; if you are marrying and you have any concerns about how your existing assets or your future savings and asset purchases would be treated if you were to sadly divorce in the future, a ‘pre-nup’ is essential. It can have a drastic impact on the outcome of your finances in the event of a divorce. 

No-one enters into marriage thinking that they will get divorced, of course. We are not here to say that you will get divorced! Marriage is a symbolic commitment, but it is also, legally speaking, a major financial commitment. You are vowing to share your ‘property’ with the other person. Property includes the obvious ones such as real estate and physical possessions, but it also includes savings, and any increase in the value of any investments during the marriage. If you do not want to risk a large proportion, and in some instances half or even more, of those assets remaining in your spouse’s ownership following a divorce, then a pre-nuptial agreement is your only option. 

A pre-nuptial agreement is not a legally binding contract. This means that it will not necessarily be followed ‘word for word’, exactly to the letter, in the event of a divorce. This is to protect people from singing a pre-nuptial agreement that would leave them in an impossible financial situation before a wedding, without fully understanding its true implications, and then being held to it at a later date. 

In order for a court to uphold a pre-nuptial agreement, it must have been freely entered into (i.e. not under duress) by both parties with a full appreciation of its implications. A full appreciation of its implications is generally viewed to require both parties having disclosed in full their finances to each other, and to have taken (or at least had the opportunity to have taken) proper legal advice before signing the pre-nuptial agreement. This way, both parties understand what they are potentially ‘giving up’, or are protecting/ gaining by signing the agreement.  

There is then a further sense-test that a pre-nuptial agreement must pass in order for a court to uphold it on divorce. This is that it must not be unfair to hold the parties to their agreement in the prevailing circumstances at the time of the divorce. This is to allow for the fact that a couple can rarely, if ever, foresee what their life will look like at the time of divorce when they are signing the pre-nuptial agreementbefore their marriage. They might have since taken on the full-time care of a dependant family member; they may have moved to a different part of the country; they may have taken on various financial commitments such as school fees and so on. Therefore the court retains some discretion in checking that following the terms of the pre-nup on divorce would not leave one party in a position of financial hardship or dire need. This is why it cannot be said that a pre-nup is legally binding.   

To ensure that this ‘sense-test’ does not defeat the pre-nuptial agreement, pre-nups are typically quite a flexible document. They will state some specific assets, or types of asset, that will not be shared with your spouse on divorce. This means that there will be no automatic concept of the assets being split between you just by virtue of your marriage – they will only be divided or sold in order for some amount to be paid to your spouse if there is a financial need to do so, i.e. some equity has to be freed up in order to help your spouse re-house or to pay for reasonable daily outgoings. However they will not set in stone every single aspect of financial considerations on divorce.    

Do not hesitate to get in touch with us here at Edwards Family Law to assist you in drawing up your pre-nup. Equally if you are already married but you think an agreement on your finances would help you, we can advise you on a “post-nup” or “mid-nup”. We are a leading firm recognised by the Legal 500.